Chico home building trending upward post-recession

CHICO &GT;&GT; A long-planned development in northeast Chico is becoming a reality, resurging from the housing collapse with visions of hundreds of new homes.

On a near-daily basis, crews hammer away at new single-family residences at Sycamore Creek Estates, a sizable subdivision bordered by Floral Avenue, Eaton Road and Ceonothus Avenue. Nearby, incoming storm drains lay the groundwork to serve the majority of an eventual 400-plus homes, along with apartments, townhouses and a small commercial sector that are all part of the planned development.

It's a trend taking place throughout Chico. After the recession-driven construction collapse, development activity has steadily picked up for the last three years as builders carry out existing and new visions for the city's housing market.

"It seems as if there are more and more people jumping into the market," said Chris Giampaoli, son of Epick Homes founder Pete Giampaoli. "Whatever builders are left ... it's taken a little bit of time for them to regroup."

Activity is still not what it once was, with only a few submittals at a time instead of the dozens common during the peak of the market, but it's a good sign, said city of Chico community development director Mark Wolfe.

"It's definitely trending up and strengthening overall over the last three years," Wolfe said. "We hope it's stabilizing."

Giampaoli marvels a bit as he realizes the planning of Sycamore Creek Estates began nearly a quarter century ago. With environmental challenges because of its wetlands and then the fluctuations of the housing market, the first homes broke ground in 2010.

Epick Homes, one of Chico's oldest developers, chooses how to build based on available lots and what kind of housing inventory is moving in town. After January 2012, they went from building a few homes a year to 35 to 40 house to now 50 to 60 houses.

"I can't tell you how good it is. It took a lot of time," Giampaoli said. "It was a tough five years — 2007, 2008, 2009, 2010, 2011 was about as tough as my dad has ever seen it."

As a developer, it's nice to see construction taking place all around Chico, Giampaoli said.

"When we build a house or a subdivision, the amount of jobs are created is a huge impact in the community — from the concrete guy to the framer to the roofer to the bankers to the title and escrow folks ... Everyone at the job site is happy to be working."

In a mixture of small, medium and large homes, 80 lots are expected to be built in this phase, followed by another 36. Giampaoli estimates it will be at least six or seven years to build out the whole project, if the market stays at current levels.

Developer Bill Webb, whose family has been building in Chico since the 1950s, said it's great to see this bustle of activity.

"I wouldn't say we are at the levels we saw pre-recession but we are closer," he said.

He is steadily building homes on a few sites, including near DeGarmo Park and at the southeast edge of town at 20th Street and Potter Road. About eight to 10 homes are under construction, another 12 to 18 lots next, and another 50 planned for next year.

Webb has noticed activity seems to be strong throughout Chico, although it's mostly older subdivisions being completed by taking over bankrupt properties or finishing those that have sat stale.

"It's just a healthy market right now," he said. "Prices are still affordable and competitive for buyers."

Yet, home building is not without its challenges. Material prices continue to rise, the state continues to add new regulations and the smaller staff at the city means it can take longer to process projects, Webb said.

But with low interest rates, it's a good time to buy and it continues to generate demand for new homes, which are attractive to buyers because they're not appreciated in value as much as existing homes and have less maintenance, he said.

With such demand, it's nice to have a flow of work for everyone, Webb noted. The tile and granite contractors he works with that were scrambling for jobs a few years ago now have projects planned two months out.

A healthy home-building market is good for the community, Webb said. He estimates his job sites alone employe 20 to 40 people every day, which generates good wages and steady employment.

"It's stressful when you are trying to figure out how to create work," he said. "Now the work is out there and it's definitely peace of mind."